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Construction Law Authority / Articles posted by Claramargaret H. Groover

Covering Complex Construction Risks Under An OCIP

Risk management practices are older than the building of Babylon (Hammurabi Code 1780 B.C.). However, the comprehensive risk management program which protects the Owner’s budget, known as an Owner-Controlled Insurance Program (OCIP), has only been available in the market place for about 20 years. “Wrap-ups”, as they are also called, were originally thought to be available only for projects in excess of $100M. Now, smaller projects of $30M or more are good candidates for OCIP benefits in today’s marketplace mainly due to the economy driving down pricing.  An OCIP’s hallmarks are its cost-effective, broad coverage for every enrolled Contractor, subcontractor, and some vendors (typically those who perform work on the job site); its safety record and reduced lost time due to injury; its reduced litigation between insured Contractors; and its responsible and financially reliable insurers which stand behind the coverage for the years before, during, and after the project is...

Build the U.S. Wants to Help get America Back to Work

 Recent cooperative efforts to get the economy rolling through individual purchasing power include the Build the U. S. movement. Build the U. S. is a grassroots organization made up of manufacturers, contractors, architects, interior designers, and home buyers committed to buying and selling materials made in the USA for use in construction projects - public and private, commercial and residential. Born primarily from the desire to contribute in large ways and small to getting America back to work, Build the U.S. also brings American-made building materials back into vogue after the hard lessons learned by homeowners, homebuilders, product distributors, and manufacturers from the Chinese drywall debacle and other such consumer-products fiascos.This movement appeals to individuals who want to focus their consumer spending in a way that also helps others. Since consumer spending makes up seventy percent (70%) of our economy and since the purchase of American-made products promotes the...

Why Should the Condominium Association Require Bonds from the Renovation Contractor

               We often encounter Condominium Associations who have difficulty understanding why they should bond their exterior renovation contract.   Many Associations consider it money wasted on another layer of liability protection when they would rather spend the money on actual scope – sticks, bricks, and finishes. They do not expect the surety to pay the claims even if they are made against the Contractor’s Performance and Payment Bonds.  Association Boards often ask, “Isn’t the risk already covered by all the insurance required from the Contractor?” The short answer is, “No”, and here’s why.             A performance bond, unlike insurance, assures the Association that the Contractor, or its Surety, will complete the project even if the contractor goes bankrupt or cannot competently perform to complete the contract. In addition, sometimes a Surety can be required to pay Association claims for work not properly performed even after occupancy. See, Federal Ins. Co. v. The Southwest Florida Retirement Center, Inc.,...